Craft a bulletproof marketing strategy with a SWOT analysis

Is SWOT analysis still useful nowadays? Wait… and what does it really mean? How is SWOT analysis done?

In this article, I covered all of these topics and much more. Knowing the meaning of SWOT analysis and implementing it correctly is fundamental for every marketer. Here is another evergreen block of the #MarketingPlan. Keep reading.

Table of contents

1. What SWOT analysis means;

2. How SWOT analysis can benefit a company;

3. How to do a SWOT analysis.

WHAT SWOT ANALYSIS MEANS

SWOT analysis is an acronym which represents a powerful assessment tool for projects and business’s strategies. SWOT stands for Strengths, Weaknesses, Opportunities and Threats.

Kotler and Keller, in Marketing and management, says:

The overall evaluation of a company’s strengths, weaknesses, opportunities and threats is called SWOT analysis. It’s a way of monitoring the external and internal marketing environment.

This evaluation is the prior step to goal-setting and consists in performing an internal (strengths and weaknesses) and external (opportunities and threats) environment analysis.

According to Kotler and Keller in Marketing and management, this scheme represents a business unit strategic-planning process.

Strengths

They are internal factors that represent a competitive advantage:

• Does the business have any successful process?

• What’s the business value proposition?

• What assets does the team have that make the business unique? Knowledge, education, network, skills, reputation...;

• Does the business have any physical assets like customers, equipment, technology, cash, patents…?

Weaknesses

Internal factors that have to be developed to unleash a business’s full potential:

• What are the flaws in the business’s processes?

• Does the business lack tangible assets like money or equipment?

• Does the team have gaps? Can team management be improved?

• Is the business located in the best area to succeed?

Opportunities

External factors that can positively contribute to a company’s growth:

• Is the target market expanding? Will people be encouraged to buy more of the product/service offered?

• What upcoming events can the company exploit to grow the business?

• And what about laws and regulations, is it expected any change that can positively impact the organization?

Threats

External factors that can block a company’s growth:

• Are potential competitors expected to enter the company’s target market?

• Will the business be able to buy raw material at a convenient price? How much power do suppliers have?

• Can future technology improvements negatively affect the business?

• If consumers behavior shifts, can it adversely influence sales?

• Is the target market stable or its trends could become a threat?

Internal environment analysis

Organizations are not perfect and transforming all of their weaknesses into strengths is madness. The question is whether a business should seize those opportunities for which it possesses the required strengths or consider those which requires to develop new strengths.

Marketers, ball’s in your court.

Get your free checklist for performing strengths/weaknesses analysis.

Here is a list of the main factors to consider while doing a business’s micro-environment audit:

• Mission, objectives, marketing strategy…;

• Product quality: product lines, product differentiation, market share, price policy, distribution channels, communication, customer service, market research, sales force, budget…;

• Research and development (R&D): product design, innovation level, processes...

Instead, here is a list of the critical key points to study during an internal environment analysis (strengths/weaknesses):

• Team management: skills, values, bond, expertise, coordination…;

• Financial perspective: profitability analysis, cost analysis, ROI…;

• Operations: raw material control, productive capacity, cost structure, equipment and material, stock check, quality check…;

• Human resources: skills, turnover, training, spirits...

External environment analysis

Every marketer should monitor important macro-environment forces and relevant micro-environment factors that affect the capacity of earning profits.

Finding attractive opportunities is one thing, but another is taking advantage of them.

Good marketing is the art of finding, developing and profiting from these opportunities.

If we set aside politics and other environmental factors that a company can exploit to grow its business, and focus on buyer’s behavior, a marketing opportunity can mainly emerge from three sources. According to Kotler and Keller a company can offer:

1. Something that is in short supply;

2. An existing product or service in a different or superior way;